IT shakeup is just the ticket at Transport for London

Oyster card systems could be run in-house

Transport for London (TfL) will complete an IT overhaul by September that has seen 15 outsourced contracts brought back in-house and desktop costs cut by more than 80 per cent.

Outgoing chief information officer (CIO) Phil Pavitt told delegates at the GC Live conference in London last week that the programme means more “sexy” systems can now be insourced.

Congestion charge and Oyster travel card systems could be operated internally now that TfL’s infrastructure has been improved, he said.

“We now have the ability to make those choices when the contracts come up for renewal,” said Pavitt.

Some parts of the system, such as Oyster readers on station platforms, would always remain outsourced, but TfL has the capability to bring systems such as billing engines in-house should it want to.

When Pavitt took over at TfL he inherited a number of disparate legacy systems, with the underground and bus IT systems entirely separated. All desktops were thick-client and had an average cost of £3,800.

During Pavitt’s two-year IT overhaul, TfL has completed what he claims to be one of the biggest thin-client rollouts in the world, bringing desktop costs down 81 per cent to around £800 per user. TfL has also consolidated 90 datacentres down to just three.

Supplier costs have fallen 41 per cent, and IT staff costs have dropped 20 per cent ­ even though the number of employees has risen, as expensive consultants were replaced with in-house workers.

In three months’ time, Pavitt leaves TfL to take over as CIO at HM Revenue & Customs (HMRC), and industry-watchers will be examining his track record for hints of possible changes in strategy at the government department.

Pavitt has a reputation in the industry as a serial insourcer ­ since being at TfL he has brought 15 of 17 pre-existing outsourced contracts back in-house.

Capgemini, BT and Fujitsu ­- suppliers to HMRC in one of the biggest public sector outsourcing deals in history ­- will be keenly aware of Pavitt’s track record.

HMRC’s £3bn Aspire contract for infrastructure management, application management and new project work was recently restructured and is now due to run to 2017.

Pavitt said he wanted to avoid a reputation for pursuing insourcing at all costs, but said he ruthlessly questions the value of outsourcing deals as a matter of course.